LATEST CHALLENGES IN EFFICIENCY CONVERGENCE IN BALKAN AND BALTIC COUNTRIES

The efficiency of banks has been widely and extensively studied in the past few decades. Using a sample of Balkan and Baltic countries and by employing a Data Envelopment Analysis model, we want to highlight the main challenges for the highly concentrated banking system. Over the period 2007 - 2011, these countries have coped with the worst financial crisis from the Great Depression, which has severe effects on the banking systems. Our sample includes the least developed countries in the EU and for reference purpose, Luxembourg, with the highest GDP per capita. We expect to find similarities between Balkan countries and Baltic countries and we can draw lessons from Luxembourg`s results.